Correlation Between Franklin Lifesmart and F/m Investments
Can any of the company-specific risk be diversified away by investing in both Franklin Lifesmart and F/m Investments at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Franklin Lifesmart and F/m Investments into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Lifesmart 2060 and Fm Investments Large, you can compare the effects of market volatilities on Franklin Lifesmart and F/m Investments and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Franklin Lifesmart with a short position of F/m Investments. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Lifesmart and F/m Investments.
Diversification Opportunities for Franklin Lifesmart and F/m Investments
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Franklin and F/m is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Lifesmart 2060 and Fm Investments Large in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fm Investments Large and Franklin Lifesmart is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Franklin Lifesmart 2060 are associated (or correlated) with F/m Investments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fm Investments Large has no effect on the direction of Franklin Lifesmart i.e., Franklin Lifesmart and F/m Investments go up and down completely randomly.
Pair Corralation between Franklin Lifesmart and F/m Investments
Assuming the 90 days horizon Franklin Lifesmart 2060 is expected to generate 0.63 times more return on investment than F/m Investments. However, Franklin Lifesmart 2060 is 1.58 times less risky than F/m Investments. It trades about 0.11 of its potential returns per unit of risk. Fm Investments Large is currently generating about 0.07 per unit of risk. If you would invest 1,319 in Franklin Lifesmart 2060 on September 8, 2025 and sell it today you would earn a total of 68.00 from holding Franklin Lifesmart 2060 or generate 5.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin Lifesmart 2060 vs. Fm Investments Large
Performance |
| Timeline |
| Franklin Lifesmart 2060 |
| Fm Investments Large |
Franklin Lifesmart and F/m Investments Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Lifesmart and F/m Investments
The main advantage of trading using opposite Franklin Lifesmart and F/m Investments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Lifesmart position performs unexpectedly, F/m Investments can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in F/m Investments will offset losses from the drop in F/m Investments' long position.| Franklin Lifesmart vs. Rbc Emerging Markets | Franklin Lifesmart vs. Wabmsx | Franklin Lifesmart vs. Abr 7525 Volatility | Franklin Lifesmart vs. Rational Dividend Capture |
| F/m Investments vs. Fm Investments Large | F/m Investments vs. State Street Target | F/m Investments vs. Hcm Tactical Growth | F/m Investments vs. Eaton Vance Global |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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